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- Discovery has launched a new platform, Discovery Green, aimed at offering businesses renewable energy along with certainty over costs.
- This will be achieved by aggregating both demand from multiple companies, but also multiple suppliers, avoiding some of the problems that can come from energy relying on the wind and sun.
- It has already filled up much of its order book for the initial phase, planning between 400MW and 1GW in renewables in 2026, and has two product offerings already.
- For more financial news, go to the News24 Business front page.
Financial services group Discovery on Wednesday announced the launch of a new renewable energy platform aimed at to providing price certainty to SA's companies while avoiding the fickleties of wind and solar generation.
The new platform, Discovery Green, aims to aggregate demand from SA corporates and match it with renewable supply, allowing companies to avoid the potential pitfalls of contracting for a certain amount of output from a renewable energy plant, but then occasionally paying for output that isn't actually needed. The platform will therefore leverage Discovery's actuarial and technical skills to act "in the middle" to match supply and demand, providing long-term contract certainty.
"We've set the goal and are in the process of procuring between 400MW and 1GW worth of renewable energy to plug in as the first phase of this platform," Andre Nepgen, head of Discovery Green, said during the launch event on Wednesday.
"Of course if demand follows, we are excited, and happy, and ready, with the sites to do a lot more."
Early companies working with Discovery on the platform include Sun International, Woolworths, Clicks, Virgin Active, Planet Fitness and Life Healthcare, while RMB is acting as the investment banker.
Construction is set to begin in early 2024, with renewable energy expected in 2026, while in its initial phase, the platform will be open to businesses that are medium to large consumers of electricity connected to Eskom's distribution network. Ultimately, it aims to utilise new "virtual wheeling" frameworks, which will allow the connection buyers that have multiple off-take sites, for example, grocers with a large store footprint, to receive wheeled energy.
This initial phase is expected to need between R20 billion and R25 billion in investment, with Discovery saying this is enough to establish 2 700 rugby field-sized solar farms, or 200 to 250 wind turbines. Nepgen said a lot of the commitment for the initial phase had been filled up but added given the size of the investment "a lot of boxes need to be ticked."
Discovery has also developed two products, though it hinted on Wednesday more will follow.
The first is the "Green Saver" product, which is aimed at those looking to maximise their financial savings. This product should provide a company with about 70% of its energy needs via renewable energy over the course of a year, which is currently about 20% cheaper than current available tariffs, said Nepgen. The receipt of energy will vary, however, depending on availability, but this offers multi-year inflation-linked price contracts, as well as an "enormous saving on the electricity bill with no upfront cost or investment whatsoever".
The second is the "Green Guarantee" product, providing companies with 100% renewable energy each month. While Discovery said this would come "without the prohibitive costs", it also added it would be aimed at those with a "strong environmental commitment".
